Wall Street in the red as FTSE closes higher amid China reopening
The FTSE 100 managed to close higher this Wednesday as top consumer China took additional measures to reopen the economy.
The FTSE 100 (^FTSE) rose 0.42% during the session to close at 7,504, while the CAC (^FCHI) in Paris lost 0.65% to 6,507 points. In Germany, the DAX (^GDAXI) tumbled 0.54% to 13,984.
Across the pond, stocks were in the red as optimism around unwinding of pandemic restrictions by China managed was offset by worries about rising COVID cases in the world's second largest economy.
The Dow Jones (^DJI) lost 0.49% to 33,078. The S&P 500 (^GSPC) retreated 0.56 % to 3,807 points and the tech-heavy Nasdaq (^IXIC) fell 0.77% to 10,273.
London's blue-chip index was pushed higher by mining heavyweights including Antofagasta (ANTO.L), Glencore (GLEN.L) and Anglo American (AAL.L)
AstraZeneca (AZN.L) was up after it said its immunotherapies Imfinzi and Imjudo have been approved in Japan for the treatment of three cancer types – advanced liver, biliary tract and lung.
Fresnillo (FRES.L) was also higher after confirming that the final testing of the downstream power distribution and control systems at the Juanicipio project was complete.
“UK markets have reopened higher, playing catch up after the FTSE 100 which was closed for a public holiday on Tuesday," said market analyst Victoria Scholar at Interactive Investor.
"The UK index could end the year in positive territory despite the broad pressures on global equity markets, weighed down by rising interest rates, inflation, and the threat of recession."
Asia-focused banks such as Prudential (PRU.L) and Standard Chartered (STAN.L) were also among the gainers
“Investors are enthusiastic about China re-opening its economy," said AvaTrade chief market analyst Naeem Aslam.
“However, there are plenty of reports which suggest that Covid cases are on the rise in China, which really threatens the supply chain.”
Read more: Global investment outlook for 2023: Looking for the silver lining
Meanwhile, Brent crude (BZ=F) is down to around $81/barrel on concerns that rising COVID cases in China, the world's top oil importer, will disrupt its economic recovery as it unwinds its pandemic restrictions, limiting fuel demand growth..
Stephen Innes, managing partner at SPI Asset Management, SAIDChina’s reopening is a double edged sword for inflation.
"The good news is that inflation subsides as China reprises its role as a supplier of low-cost goods globally and supply chain bottlenecks ease. Still, the bad news is as growth accelerates through Q1, China’s insatiable demand for raw materials and all things energy will push up prices of those commodities, much to the consternation of the Fed and ECB."
Read more: Will Santa gift investors with a stock market rally?
In Asia, Tokyo’s Nikkei 225 (^N225) fell 0.41% to finish at 26,340 while the Hang Seng (^HSI) in Hong Kong climbed 1.46% to 19,879. The Shanghai Composite (000001.SS) lost 0.26% to 3,087 points.
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